Investopoly Q&A - Develop, rentvest or debt-recycle? Structures, tax & capacity
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Dec 29, 2025 Stuart delves into critical crossroads for investors, discussing the merits of small-scale development versus rent-vesting. He highlights the pros and cons of different ownership structures, recommending a company owned by a trust for repeat projects. The concept of debt-recycling is explored as a strategy for those unable to afford investment-grade properties. A case study of a high-debt Sydney family sheds light on managing cash flow and investment choices, emphasizing patience during childcare years and the importance of strategic planning.
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Brisbane Rebuild Turned Land Value Into Income
- AJ bought a high land-value Brisbane property in 2016, added a rebuild and granny flat, and now it yields strong cashflow and growth.
- Stuart uses this example to show land-weighted homes can be converted into high-income, high-growth assets with timing and improvements.
Sell Serviced Blocks, Avoid Construction Risk
- If you can, obtain subdivision approval and sell serviced blocks rather than building yourself to avoid construction risk.
- Accept a smaller, reliable profit instead of gambling an extra $100k on construction complications.
Use A Company Owned By A Family Trust
- Use a company for repeat development profits to quarantine risk and cap tax at 30%.
- Hold the company shares in a family trust to preserve distribution flexibility and control.